Quantitative Method for Finance

The course introduces students to the fundamental concept of quantitative methods, and a wide variety of quantitative techniques in finance. After taking this subject, students are expected to be able to: (1) apply quantitative methods in financial research systematically; (2) use quantitative methods to solve problems in banking and financial management; (3) formulate mathematical model for certain financial management problems; (4) compare and evaluate the effectiveness of several alternative of financial mathematical models using computer software. The course introduces the fundamental concepts of Mathematics of Finance and the application of mathematics in the financial markets. The course covers calculation of interest rates (simple, discount and compound interest), concepts of time value of money as well as annuities and perpetuities, ordinary calculus for applied finance such as differentiations, integrations, and ordinary differential equations. The course would also give an introduction on some applications of stochastic process in finance, including: probability theory, stochastic calculus and some other techniques used in modern finance.